Hormuz crisis lifts urea to $625 a tonne as Bangladesh weighs its fertiliser stocks

In March 2026 the war in the Middle East threw global fuel and fertiliser supplies into doubt, raising fears for Bangladesh's farm output. BBC Bangla reported on 28 March that many farmers had struggled to get enough diesel to irrigate their boro rice and that worry was growing about fertiliser for the coming aman season. Agriculture Minister Mohammad Amin Ur Rashid told BBC Bangla that existing stocks would last roughly a year.

According to BBC Bangla, the government shut four of the five state-owned fertiliser factories from early March to conserve gas, and the private KAFCO plant had also stopped. The factories rely heavily on imported liquefied natural gas (LNG). In a March analysis, CRU Group wrote that Bangladesh takes about 65 percent of its LNG from Qatar, that the interruption to Qatari exports was understood to have contributed to four shutdowns, and that the country's plants averaged about 25 percent of capacity in 2024-25.

The minister said the closures were part of fuel rationing, made possible by adequate stocks, and would be short. "I have spoken to the power and energy minister and he has said they will be restarted. Even if only Ghorashal comes back on line we will get more than 2,800 tonnes a day," he said. Ghorasal Polash in Narsingdi, run by the Bangladesh Chemical Industries Corporation (BCIC), is the country's largest fertiliser plant; KAFCO, at Anwara in Chattogram, has made urea from natural gas since 1994.

Ministry figures put stocks at 493,000 tonnes of urea, 382,000 tonnes of TSP, 509,000 tonnes of DAP and 342,000 tonnes of MOP. Bangladesh uses about 7 million tonnes of fertiliser a year; the Bangladesh Fertilizer Association puts urea at about 2.65 million tonnes of that, of which only 1 million tonnes is made at home. Urea, the main nitrogen source for crops, has the highest nitrogen content of the common solid nitrogen fertilisers.

The minister said boro was nearly over and aman needs comparatively little urea, so imports were being prepared for next year's boro, with China and Egypt approached to reduce reliance on the Middle East. "We mainly imported urea from Qatar and Saudi Arabia. There is no crisis at the moment, but since this is an ongoing process we are looking for alternative sources," he said.

Dr Mohammad Amirul Islam, dean of the faculty of agricultural economics and rural sociology at the agricultural university, told BBC Bangla that the rice crop was nearly finished and needed little fertiliser. Agricultural economists warned that stocks alone would not suffice if the war dragged on, and urged quick imports from China, Egypt or Russia and the reopening of idle plants. Dr Islam cautioned that alternative sources might cost more.

Despite the official reassurance, BBC Bangla heard that dealers in some districts were accused of creating artificial shortages to charge more. "In Bangladesh we create an artificial crisis before any real crisis arrives, and that is the main problem," Dr Islam said.

The Strait of Hormuz links the Persian Gulf with the Gulf of Oman. The U.S. Energy Information Administration says about 20 million barrels of oil a day passed through it in 2024, about 20 percent of world petroleum liquids consumption, along with about a fifth of global LNG trade, mainly from Qatar. BBC Bangla reported that a third of the world's fertiliser also moves through the strait, which Iran had kept closed for about a month.

Citing CRU Group, BBC Bangla said world urea prices had risen about 25 percent since the war began, from $490 to $625 a tonne. Tom Bradshaw, president of the UK's National Farmers' Union, said crop, livestock and dairy farmers were already strained by dearer fuel and fertiliser. Researchers at Germany's Kiel Institute estimated that a closed Hormuz could raise world wheat prices by up to 4.2 percent and fruit and vegetable prices by 5.2 percent. Russia supplies about a fifth of world fertiliser exports, and experts expected it to try to strengthen its position while Middle Eastern supply was cut off.

Photo: AbuSayeed / Wikimedia Commons (CC BY-SA 4.0)

Sources: BBC Bangla, CRU Group, U.S. Energy Information Administration (EIA), Wikipedia